Mukush Ambani's Reliance, Zee Group and Tata's Indian Hotels are the three prime companies that have filled in papers for the project, reports Rajendra Aklekar.

India's top three companies have bid for railway's plans to build a proposed budget hotel at Carnac Bunder near Mumbai CST. Budget Hotels is a new value-added concept developed by the railways to provide affordable hotel accommodation to its passengers.

Reliable railway sources said Mukush Ambani's Reliance, Subhash Chandra Goel's Zee Group and Tata's Indian Hotels are the three prime companies that have filled in papers for the project.

A senior official said the railways budget hotels will be of "2-star category" christened 'Rail Ratna' and the authorities had already begun setting them up at a number of railway sites across the country. These hotels would be constructed through public-private partnerships.

The railways have re-invited second round of bids for the project after lack of response in the first round. Following suggestions from the hotel companies, the railways diluted the terms and conditions for bidders to attract greater private sector participation. It has also prepared a "letter of comfort" for these companies to facilitate smooth transfer of land.

Since the land is being provided by the Railways, interested parties wanted a guarantee from the land provider to ensure that the terms of land use do not change midway. The properties will be developed on build-operate-lease basis with a lease period of 30 years. Once constructed, the railways plan to offer total travel packages to passengers.

"The passenger will be in a position to buy his hotel accommodation along with his railway ticket as an entire travel package," said an official. The department is targeting middle and lower-middle class passengers, especially vacationing families, with these packages.

A substantial number of rooms in these hotels are expected to come for less than Rs 1,000 per night. The hotels would on an average have a capacity of around 100 rooms. IRCTC has been named as the nodal agency for co-ordinating with the private sector companies to develop budget hotels.